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METRO GROUP : ANNUAL REPORT 2010 : BUSINESS
→ GROUP MANAGEMENT REPORT : 9. NOTES PURSUANT TO § 315 SECTION 4 OF ThE GERMAN COMMERCIAL COdE
ANd EXPL ANATORy REPORT OF ThE MANAGEMENT BOARd
tion takes effect or – if this value is lower – at the time the
authorisation is exercised. The following count towards the
aforementioned 10 percent limit
→ new ordinary shares issued from authorised capital
excluding subscription rights according to § 186 Section 3
Sentence 4 of the German Stock Corporation Act during
the term of the authorisation prior to the issuance of
bonds with warrant or conversion rights or obligations
without subscription rights according to § 186 Section 3
Sentence 4 of the German Stock Corporation Act,
→ and ordinary shares acquired based on the authorisation
of the Annual General Meeting according to § 71 Section 1
No. 8 of the German Stock Corporation Act and sold
according to § 71 Section 1 No. 8 Sentence 5, § 186 Section 3
Sentence 4 of the German Stock Corporation Act during
the term of such authorisation, prior to the issuance of
bonds with warrant or conversion rights or obligations
excluding subscription rights according to § 186 Section 3
Sentence 4 of the German Stock Corporation Act.
If bonds carrying warrant or conversion rights or obligations
are issued, the warrant or conversion price is determined
based on the rules in § 4 Section 8 of METRO AG’s Articles
of Association, which are laid out under point 8, letter b) aa).
In the case of bonds carrying warrant or conversion rights or
obligations, the warrant or conversion price may be adjusted
after closer determination in order to preserve the value of such
rights or obligations in the event their economic value is diluted,
unless such an adjustment is also provided for by law. The terms
of the bonds may also provide for an adjustment of warrant or
conversion rights or obligations in case of a capital reduction or
other extraordinary measures or events (e.g., unusually high
dividends, acquisition of control by third parties). In case of the
acquisition of control by third parties, the terms of the bonds
may provide for adjustment of the warrant or conversion price
in accordance with typical market terms. Furthermore, the
terms of the bonds may provide for a variable conversion ratio
and/or a variable warrant and conversion price whereby the
warrant or conversion price is determined within a range to be
set based on the development of the share price during the term.
The minimum issue price based on the stipulations of § 4 Section
8 of METRO AG’s Articles of Association in the version
printed under point 8, letter b) aa) may not be undercut.
The terms of the bonds may grant METRO AG the right, in
lieu of providing ordinary shares upon the exercise of warrant
or conversion rights, to make a cash payment corres-
→ p. 124
ponding to the volume-weighted average price of METRO AG
ordinary shares on the XETRA trading system (or a functionally
comparable successor system replacing the XETRA
system) of the Frankfurt Stock Exchange during a period of
several days before or after the exercise of warrant or conversion
rights is announced for the number of ordinary
shares which would otherwise be delivered. This period is to
be determined by the Management Board. The terms of the
bonds may also state that the warrant or convertible bonds
may, at the Company’s option, be converted into existing
ordinary shares in METRO AG or shares in another exchangelisted
company, in lieu of conversion into new ordinary
shares from contingent capital, and that warrant rights or
obligations can be fulfilled through the delivery of such
shares.
The terms of the bonds may also call for a warrant or conversion
obligation at the end of the term (or at any other time),
or authorise METRO AG to grant bond holders ordinary
shares in METRO AG or shares in another exchange-listed
company upon maturity of bonds carrying warrant or conversion
rights (including bonds which mature due to termination),
in whole or in part, in lieu of a maturity payment in
cash. The percentage of share capital represented by the
ordinary shares in METRO AG issued upon the exercise of
warrant or conversion rights may not exceed the par value
of the bonds. §§ 9 Section 1, 199 Section 2 of the German
Stock Corporation Act apply.
The Management Board is authorised, with the consent of
the Supervisory Board, to determine the further details pertaining
to the issuance and terms of the bonds, particularly
the coupon, issue price, term, division into shares, rules for
the protection against dilution and the warrant or conversion
period, or to define such details in consultation with the corporate
officers of the affiliate of METRO AG which issues the
warrant or convertible bonds.
The authorisations to issue bonds are designed to expand
METRO AG’s financing leeway and provide the Company with
flexible and short-term access to financing upon the emergence
of favourable capital market conditions, in particular.
Issues of bonds with conversion or warrant rights on shares
of METRO AG provide a means of raising capital at attractive
conditions. The convertible and warrant premiums attained
flow to the Company. The additionally foreseen possibility of
not only granting conversion and warrant rights, but also
introducing warrant and conversion obligations, and allow-